Archos v Philips (Rechtbank Den Haag, HA ZA 16-206, 2017)

Dhenne Avocats · 11 October 2026

Our analysis

Summary

In a merits action brought by Archos, The Hague District Court refused to declare that Philips’s licence offer for its UMTS and LTE portfolio was not FRAND, or that Archos’s counter-offer was. The implementer bears the burden of showing that the offer is not FRAND; a FRAND licence allows for a range; and the court worked through the complaints based on Philips’s share of essential patents, the royalty base, royalty stacking and discrimination. The judgment is of interest to any implementer tempted by a declaratory action without having genuinely negotiated.

Facts and procedure

Philips declared patents essential to the UMTS and LTE standards to ETSI and undertook to license them on FRAND terms (point 2.1). After discussions starting in 2014, it offered Archos on 28 July 2015 a royalty of USD 0.75 per product, rising to USD 1 for past sales and in case of breach (points 2.3 to 2.6). On 3 September 2015 Archos declined the licence and told Philips to sue (point 2.7), then on 12 January 2016 proposed 0.071% of net revenue, about 7 cents per product (point 2.8). Philips brought infringement actions in the Netherlands, Germany and France (points 2.2 and 2.7). Archos sought declarations that Philips’s offer was not FRAND and that its own rates were (point 3.1).

The applicable law

Archos relied on the undertaking given under clause 6.1 of the ETSI IPR Policy, abuse of dominance (Article 102 TFEU), pre-contractual good faith and abuse of rights (point 3.2). It bore the burden of proof under Article 150 Rv (point 4.2). The court referred to the framework of Huawei v ZTE (points 4.3 and 4.12).

Question

Has the implementer shown that the patentee’s offer is not FRAND and that its own counter-offer is?

Decision

Archos’s claims were dismissed (point 5.1). Philips was willing to negotiate the rate, its structure and the other terms, whereas Archos did virtually nothing before the proceedings (point 4.3). A FRAND licence has a range: a first offer that proves unfavourable to a particular implementer, for example one operating in the low-budget segment, is not thereby non-FRAND (point 4.3). Exhaustion based on Qualcomm chips failed, as that licence covered chips rather than phones (point 4.4). Philips’s share must be measured against patents relevant to handsets only, and the weighting used by Archos’s expert was speculative (points 4.6 and 4.7). Neither royalty stacking, nor the choice between chip and device as the royalty base, nor the surcharge for breach made the offer non-FRAND, these being matters for negotiation (points 4.8 to 4.12). The hold-up argument presupposes a non-FRAND offer (point 4.13). Discrimination was not substantiated, Philips’s expert having found that its existing licences contained essentially identical terms (point 4.14). Archos’s counter-offer, more than ten times lower, was not FRAND (point 4.17).

Key points for practice

• An implementer seeking a declaration that the patentee’s offer is not FRAND bears the burden of allegation and proof, with no reversal in principle (point 4.2).
• Objections not raised during negotiations (royalty base, audit, indemnity or termination clauses) carry little weight in court (points 4.10, 4.11 and 4.16).
• A discrimination complaint requires identification of a more favourable licence granted to a third party (point 4.14).
• Practical point: a FRAND declaratory action requires a quantified and reasoned counter-offer, based on a credible assessment of the patentee’s share of the relevant essential patents.

Provisions applied

Treaty on the Functioning of the European Union

Art. 102

Regulation (EU) No 1215/2012

Art. 26

ETSI IPR Policy

clause 6.1

National law

Arts 29, 150 and 1019h Rv

Case law cited

CJEU, 16 July 2015, Huawei v ZTE (C-170/13); BGH, 6 May 2009, KZR 39/06, Orange-Book-Standard; Rechtbank Den Haag, 17 March 2010, Philips v SK Kassetten; Gerechtshof Den Haag, 26 February 2013, Danisco v Novozymes; LG Mannheim, 1 July 2016, 7 O 209/15

Related decisions

• Huawei v ZTE, 16 July 2015, negotiation framework applied by the court.
• Orange-Book-Standard, BGH, 6 May 2009, earlier case law recalled by the court.

Prepared by Dhenne Avocats from the text of the decision (rechtspraak.nl open data service), consulted on 11 October 2026. Only the official text is authoritative.